"Some of the key determinants for success in long/short have been in place – a low correlation of performance between industry sectors and high performance dispersion within sectors.

“By way of example, the healthcare and telecommunication sectors returned 33 per cent and 24 per cent respectively over the last 12 months, versus energy and consumer staples, which returned -15 per cent and -7 per cent, respectively," he said.

There haven't been a lack of opportunities on the short side either, Mr Sebire said.

"From a market value perspective, Woolworths and Orica were two of the most heavily shorted companies," he said.

"Woolworths has suffered from declining margins and losses from its Masters business, while Orica navigated a change in chief executive and declining demand for its explosives products," Mr Sebire said.

The "conducive environment" for long/short investing is likely to continue over the next 12 months, he said.

"Zenith expects further mean reversion in those sectors that have been artificially inflated by the yield trade; the likes of financials (banks), telecommunications, healthcare and property.